Gold: Further upside potential
After falling back to the 1.575 area, the gold market has been trading sideways to slightly higher in the last three trading sessions. At 1.580 this morning, gold has cleared a declining resistance line on the 30-min chart, with the 20 moving average turning up. With the technical set-up indicating the possibility of a re-test of 1.587, it looks like there is further upside potential in the market. A break above 1.587 would open the way for 1.693 and 1.619. In the alternative scenario, the downside penetration of 1.565 could call for 1.555 and 1.538, but it should be noted here that, from a long-term view, the trend remains on the upside as long as the key resistance area at 1.500 remains intact. On the economic data front things are a little quiet with the EU Retail Sales due for release this morning during European hours.
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